Teaching German

Europe

Shared Responsibility for Stability Pact

Reforms to Germany's constitution will see the federal government and Germany's states sharing the burden of EU fines should the country again break the stability pact rules.

Germany's obligations under the stability pact, the rules governing the euro, are to be included in its constitution, following an agreement made on Sunday. These planned reforms, which have to be approved by parliament, would see Germany's states pay a part of any fines received under the stability pact. A fine is the ultimate punishment meted out under the pact for failure to adhere to its rules of maintaining a budget deficit below 3 percent of GDP. Germany has violated the pact three years in a row. According to the
Financial Times Deutschland newspaper, the federal government would have to pay 65 percent of the fines, while the 16 states would have to pay the remaining 35 percent. The agreement came after several months of cross-party negotiation which finally allowed the federalism commission on Sunday to announce a deal. The proposals concerning the stability pact are part of wider constitutional reform in Germany.
(EUobserver.com)